Inflation fears spark debt consolidations

Fears over the rising rate of inflation have sparked an upsurge in debt consolidation activity in the UK, it has been suggested.

Concerns over the rising cost of living have motivated around seven per cent of British consumers to consolidate their credit card debt into a personal loan they hope will be easier to pay off.

Meanwhile, more than one in ten people have switched their credit card provider in search of a better deal since the alarm was first raised over inflationary pressures, Alliance & Leicester reports.

“Taking advantage of the best financial deals on the market is always important, but more so in the current environment,” said Emma Walkley, current account manager at Alliance & Leicester.

“We would advise people to take a good look at their finances and see how they can be improved,” she added.

Credit reference firm Callcredit reported last week that around 40 per cent of UK consumers would see their savings run out within a month if their income streams dried up.